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Oil Rallies to Weekly High on Concerns for Supply After Spill

Oil rallied to the highest level in a week as output from Alaska’s North Slope was suspended for the most part after a leak to the Trans Alaska Pipeline System on January 8th. Oil also gained as the National Commission on the BP Deepwater Horizon Oil Spill said that the government rules and the oil-industry practices need to be reformed. The panel recommended that exploration in US deep waters be overseen by a new independent agency in the Interior Department.

Phil Flynn, vice president of research at PFGBest, commented on the news:

The market took off after the release of the presidential panel’s report. There’s concern that it will become more difficult to develop resources and there will be less oil available.

The February contract on crude oil rose $0.08 to $91.19 per barrel on NYMEX after yesterday’s rally by $1.86 to $91.11, the highest settlement since January 3rd. February settlement for Brent oil gained $1.91 (2 percent) to $97.61 per barrel on ICE yesterday.
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